SC grants bail to DHFL's Kapil and Dheeraj Wadhawan in Rs 34,000-crore bank scam case

The Wadhawan brothers were arrested in this case in July 2022

Supreme Court has granted bail to former DHFL promoters Kapil Wadhawan and his brother Dheeraj in a Rs 34,000-crore bank fraud case, saying undertrial prisoner should not be placed behind bars indefinitely

A top court's bench comprising of Justices J K Maheshwari and Vijay Bishnoi, in its December 11 order, observed that their prolonged incarceration without trial strikes at the heart of Article 21, which guarantees the right to life and personal liberty.

The court said "bail is the rule and jail is an exception" under Indian laws and it is etched in the ethos of the country's criminal jurisprudence.

It said pretrial incarceration cannot be allowed to degenerate into punishment without adjudication, and courts are constitutionally obliged to intervene where long custody becomes disproportionate, arbitrary, or excessive.

"Looking at the number of witnesses and the orders passed by the courts, it appears that if the case is taken up on a day-to-day basis, even in two to three years, the conclusion is not possible.

"Considering all the facts and circumstances of the case, subject to putting the restrictions on movement of appellants out of India, and without expressing any opinion on the merits of the case, we deem it appropriate to release the appellants on bail with conditions," the bench said.

The top court directed that the duo shall disclose their place of residence and contact number to the concerned jurisdictional trial court as well as the police station where they would stay within one week of their release.

"They shall mark their presence in the jurisdictional police station once a month and after framing of charges, before the trial court on the dates as specified. The appellants shall not leave the territorial jurisdiction of the country without the prior permission of the High Court and shall surrender their passports with the concerned trial court within two days of their release," the bench said.

The apex court said any attempt by the appellants to influence or threaten the witnesses, whether directly or indirectly, shall result in cancellation of the bail on application by the prosecution.

"The Appellants are directed to remain present before the trial court on dates so fixed by trial court until exempted, and no unnecessary adjournment shall be sought by them. Learned trial court is also at liberty to impose any other conditions on them, if needed.

"Any violation of these conditions, unless due to an exceptional or unforeseeable ground, shall be treated as valid condition for cancellation of bail," the bench said. The Wadhawan brothers were arrested in this case in July 2022. The CBI filed a chargesheet in October 2022 following which a court took its cognisance. The premier investigating agency had alleged that the Wadhwan brothers had caused a wrongful loss of Rs 34,615 crore as on July 31, 2020.

The FIR was registered on a complaint by the Union Bank of India, which alleged that DHFL, its former chairman-cum-managing director Kapil Wadhawan, former director Dheeraj Wadhawan and other accused entered into a criminal conspiracy to cheat the consortium of 17 banks led by the Union Bank of India. In pursuance of the criminal conspiracy, the accused and others induced the consortium to sanction huge loans aggregating Rs 42,871.42 crore.

Much of the amount was allegedly siphoned off and misappropriated by alleged falsification of the books of the DHFL and dishonest default in repayment of legitimate dues of the consortium banks, the CBI claimed.